This is an interesting discussion.
I agree with the principle that players determine how their characters think, act, & feel. As such, I typically refrain from telling them what they think, how they act, or how they feel. Likewise, I tend to avoid using Deception checks, Intimidation Checks, Persuasion checks, etc., against the PCs unless in some kind of contested action.
And I tend to resolve PvP in the following way: When one player takes an action against another player, it is up to the recipient of that action to determine the result of the action. I do this because I feel PvP is a huge waste of time unless it's something the players are very interested in hashing out. This permits them to engage with it as much or as little as they wish. This is not a matter of "how the world works" it's a metagame concern over how I want my table to run and how much time I wish to spend on particular activities.
Now there are some exceptions to how I treat the thoughts, feelings, and actions of PCs. These exceptions happen when I'm framing a new scene or concluding one.
For instance, I like to use mood-setting words in my descriptions. (Spooky, disgusting, lovely, comforting, dreadful, etc, etc). While these don't really say "you do/must feel this way" they do set an expectation. I have no problem with this.
And also when concluding a scene, I have from time to time taken some amount of control over PC actions. For instance, "You spend the rest of the afternoon questioning the prisoner. After learning X Y & Z, it is clear you've gotten everything you can get out of him. You leave to meet up with everyone else at dinner and discuss your findings..." I have no problem with this either.
And again, the reason I DONT object to these (intrusions?) on player agency is because they're used in the service of moving along the game. Time is our currency, I don't want to be wasteful with it. And I generally won't permit it to be monopolized or spent by one player at the expense of other players.
That said, I don't tell the players how their characters feel or act or think during a scene or encounter. That strikes me as unfairly infringing on their bit of the game. And i "get" very little from it.
So for me, this isn't a black and white issue. But it's 45% black, 45% white, and 10% gray. And while I'll bend a little in the gray, I will try to do so with a fairly light touch or in the service of moving on to the next interesting and playable bit.